NOVEMBER 2016 | 07
to nail it the first time, in terms of
quality, really helps with affordability
and being competitive.
How is Boeing working with suppliers?
We’re spending more time with suppliers
because we see their cost structure as
our cost structure. With a backlog of
nearly 5,700 airplanes at Commercial
Airplanes and two-thirds of every
airplane’s cost coming through the
supply chain, we have a big opportunity
to reduce costs by working smarter
with our suppliers. That’s the idea
behind Partnering for Success, our
enterprise effort to work with suppliers
to reduce costs and provide the
highest-quality products.
And our supplier relationships
continue to deepen. A great example is
how we’ve worked to increase production
efficiency on the 787 program. We’re
now down to looking at what we can
do minute by minute to improve flow of
the production system. We share what
we’ve learned with our supplier partners
so they can make similar changes and
become more competitive.
Is Partnering for Success a
long-term effort?
It has to be, because our customers
will continue to expect more for less.
We must keep looking for ways to trim
costs and be more efficient. Partnering
for Success is much more than simply
reviewing supplier contracts for better
terms. We don’t ask our suppliers to
do anything we wouldn’t do ourselves.
Our spirit of working together and
embedding teams with suppliers is
vital to driving quality and stability.
This year, we’ve extended this work
through our “boots on the ground”
initiative that involves engineering,
finance, operations and Lean+ teams
relocating to supplier sites for one
year. Over that time, our people work
with our supplier partners to capture
even more productivity, capability
and savings. We have more work
to do, but the early results are very
encouraging. And as our supplier
relationships grow, we will be better
able to work with them on development
of new processes and technology that
we can both use. The future payoff
is when those things are implemented
and we begin to see better quality and
efficiency stemming from them.
What about process changes?
A lot of it involves streamlining processes
that drive cost. Earlier this year, we
changed when we pay large suppliers
to the way most businesses do it.
Change isn’t easy, and we continue to
work with those suppliers through the
transition. We’re also managing our
inventory better. For example, we’ve
created better processes to understand
what raw materials and parts are needed
to run the business most efficiently.
We’re also bundling parts orders across
programs to take advantage of bulk
discounts. These efforts support our
ability to generate cash and to manage
it effectively, which is fundamental to
running a healthy business.
How can employees help?
Every employee plays a part in making
Boeing more competitive, and often
the simplest things can make a big
difference. From using Lean+ to
improve productivity and flow, to
driving first-time quality in the office
and factory to reduce rework, everyone
can create value while providing
the most innovative yet affordable
products. That’s our responsibility as
individuals. And by working together
with our supplier partners, we can
capture significant opportunities and
successfully address the market
forces affecting our industry.
That winning mindset and our
100 years of successfully adapting
to new challenges will extend our
leadership position going forward. •